Some more positive news from the July numbers as home prices rose for the third month in a row, the data shows that housing recover is underway but it is still very fragile. The Standard & Poor's/Case-Shiller home price index of 20 major cities climbed 1.2 percent from June to a reading of 143.05. The index has risen at an 8 percent annualized rate in the three months to July, the best performance since early 2006.
The index, however, is down about 33 percent from the peak in mid-2006. Home prices are now at levels not seen since the third quarter of 2003. And prices in Las Vegas, Detroit and Seattle are still falling, on a seasonally adjusted basis.
Home prices continue to fall and are 13.3 percent below July a year ago. The annual declines have manifested in all 20 cities that the report covers. This decline has been reported for six straight months.
In Alameda, we have seen median home price rise and the inventory has been sucked up over the past three months. The Island reached a 45 week low of 122 units. This is 32 percent decline in 10 weeks. Normally low inventory means a price will begin to rise. A preliminary look at September sales shows that this may be the fact.
There are still several risks to the national housing recovery, including rising unemployment and foreclosures and the expiration of a tax credit for first-time home buyers.
The biggest factor, in my opinion, still weighing on the housing sector is jobs and wages. Wages in the United States are lagging and have declined 5 percent year-over-year and job loss continues to grow. This segment of the economy needs to stabilize for housing to correct.
As I have written about in the past, the shadow inventory of distressed properties will have a major impact. If the banks are still holding on to a large number of homes and they flood the market in the spring this will destabilize the housing market.
Some experts believe that the housing market has hit bottom. Low price inventory has cleared in many cities and bidding wars have evolved in many of these areas. The upper levels of the market are having more trouble with higher priced homes sitting longer.Places like Las Vegas that had a gamblers feel to housing was one of the most speculative markets during the boom. As quick as you win in Vegas you also lost with homes down almost 55 percent from their peak. In August, almost 80 percent of home resales in Nevada were either a foreclosure or a sale below the value of the mortgage, according to a survey by the National Association of Realtors. The Detroit housing market is reeling from layoffs in the automotive industry. Seattle, by contrast, was one of the last areas to enter the downturn so prices there have yet to hit bottom.
The Alameda Real Estate market has been more like Austin, TX and Salt Lake City, UT where the pullback has been more moderate. The good part for Alameda homeowners is the region is bouncing back.Home prices rose in 13 metro areas for at least three straight months. The biggest gains in July were in Minneapolis, San Francisco and Chicago.
More on Case-Shiller
Tuesday, September 29, 2009
Monday, September 28, 2009
Alameda Inventory Down and Points to Good Signs
I have been writing the 94501 Real Estate blog for 45 weeks now, and the one consistent topic I cover is inventory. Inventory is gives us a good understanding of the Alameda market and how homes are selling.
Over the past three months the inventory has been sucked up and we have reached a 45 week low of 122 units. This is 32 percent decline in 10 weeks. Normally low inventory means a price will begin to rise A preliminary look at September sales shows that this may be the fact.
With three days left in the month September has already recorded 41 sales a big increase from the same time last year. The number that caught my eye was the increase in both median and average home sale price. The current September median is $568,000 a 12 percent increase over August's $505,500 and a 4 percent year-over-year increase.
The Average sale price saw a 6 percent increase from August and a 5 percent decline from September 2008.
Alameda now has just 79 single family residences and 22 condos for sales. A look at sales bands shows that homes are divided fairly evenly:
Under $500,000 -- 34 units
$500,000 to $700,000 -- 36 units
$700,001 to $999,999 -- 37 units
$1,000,000 or more -- 15 units
The lowest priced property on the market jumped this week $40,000 to $269,000. This is the highest of the low has been since tracking inventory. It appears that the low end is being snapped up by buyers.
Homes that are using price reductions to sell are also declining in proportion to inventory. The homes with price reductions range between 34 percent and 42 percent since the beginning of the year.
Most of this is good news: homes selling, median price stabilizing and evenly distributed inventory. I am not sure that the Alameda housing market has turned around, but all the signs in September show a positive step towards recovery. The only thing that needs to be monitored is the distressed market, if a glut of homes hit the market in the next several months this could erase the positives.
Weekly Inventory Data
Over the past three months the inventory has been sucked up and we have reached a 45 week low of 122 units. This is 32 percent decline in 10 weeks. Normally low inventory means a price will begin to rise A preliminary look at September sales shows that this may be the fact.
With three days left in the month September has already recorded 41 sales a big increase from the same time last year. The number that caught my eye was the increase in both median and average home sale price. The current September median is $568,000 a 12 percent increase over August's $505,500 and a 4 percent year-over-year increase.
The Average sale price saw a 6 percent increase from August and a 5 percent decline from September 2008.
Alameda now has just 79 single family residences and 22 condos for sales. A look at sales bands shows that homes are divided fairly evenly:
Under $500,000 -- 34 units
$500,000 to $700,000 -- 36 units
$700,001 to $999,999 -- 37 units
$1,000,000 or more -- 15 units
The lowest priced property on the market jumped this week $40,000 to $269,000. This is the highest of the low has been since tracking inventory. It appears that the low end is being snapped up by buyers.
Homes that are using price reductions to sell are also declining in proportion to inventory. The homes with price reductions range between 34 percent and 42 percent since the beginning of the year.
Most of this is good news: homes selling, median price stabilizing and evenly distributed inventory. I am not sure that the Alameda housing market has turned around, but all the signs in September show a positive step towards recovery. The only thing that needs to be monitored is the distressed market, if a glut of homes hit the market in the next several months this could erase the positives.
Weekly Inventory Data
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Friday, September 25, 2009
Alameda Snapshot: Alameda vs. Encinal 1978
Today's Alameda snapshot is of "The Big Game", a.ka. The Island Bowl, in 1978. A local sports writer renamed the game in the 90s. The 54th annual renewal of this crosstown rivalry is renewed tonight at Encinal's Willie Stargell field at 7 PM.
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